Private Providers Fight Back Over Service Change

Health care assistant Crystal Kreig plays a card game with Steve Parker (center) and Eulalio Alvarada (right) at a group home operated by D&S Residential, Inc. Companies like D&S used to handle case management for their clients, but a budget change sent that responsibility to local Mental Retardation Authorities.

For years, the state paid private providers who care for people with disabilities to help the clients decide how many services they need and how intensive they should be.

But an 11th-hour change state lawmakers inserted into the budget last session stripped the private providers of this case management responsibility, giving it instead to local, quasi-governmental Mental Retardation Authorities, who administer publicly funded services to people with disabilities.

The goal, lawmakers said, was to avoid conflicts of interest — to ensure the 19,000 people receiving Medicaid waiver services at home and in the community had case managers who were advocating in their best interests and were not motivated by their employer’s bottom line.

The reality, the providers allege, is just the opposite.

Nearly all of the state’s MRAs provide some care services — including operating group homes — in addition to their case management role. Private providers, some of whom say they are losing hundreds of thousands of dollars a year under the new arrangement, argue that if they cannot be case managers, MRAs should not be allowed to provide care services.

“There’s an underlying feeling that they’re cherry-picking, that they’re filling up their homes first,” said Mickey Atkins, chief executive of D&S Residential, a private provider that operates group homes across Texas. “Any time you’re competing with somebody, you want it on a fair playing field.”

MRAs aren't exactly in the expansion business. Lawmakers passed a bill in 2003 designating them “providers of last resort,” and in 2007, they capped the number of clients to whom they can provide services. Thirty-eight of the state’s 39 MRAs provide some care services, but private providers care for the overwhelming majority — more than 80 percent — of Texans who qualify for the services.

Private providers say that while they understand the intent of the change, it has resulted in more gaps in coordination and, in some regions, a lack of trust. Though the MRA case managers are required to objectively offer clients a complete list of care providers, the private providers say they have no proof that it is happening. Some are asking state health officials and lawmakers to push for a return to the old way in the upcoming legislative session.

MRA officials agree that the debate is one for the Legislature. But they caution that, for years, private providers had to be begged and pleaded to provide community-based care — and even today, some private providers do not operate in remote corners of the state.

“The state has created a situation where future growth is primarily in the private sector,” Castle said, “but they’re still allowing a public sector option for consumers who feel more comfortable there.”

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